Stamp Duty Holiday
What is Stamp Duty?
Stamp Duty Land Tax (SDLT) is applied to some residential property purchases in England and Northern Ireland. Ordinarily, there are different tax rates for different purchases prices ranging from 0% (up to £125,000) to 12% (in excess of £1,500,000).
What have the government announced?
Due to the national impact of COVID-19, the government have announced a ‘Stamp Duty Holiday’ to run from 8th July 2020 until 31st March 2021. This tax break aims to encourage people to buy houses, offering financial support is the form of a tax cut. This is great news for anyone who is planning on or in the midst of purchasing a property and the new changes mean that no stamp duty is paid on the first £500,000 of a house purchase. The changes will also apply for people looking to purchase a second home and could save buyers thousands, however the 3% second home stamp duty surcharge will remain.
If you were looking to buy your next home valued at £400,000, you would save £10,000 in SDLT under the new changes.
If you were looking to buy a second home valued at £500,000, you would pay only £15,000 instead of £30,000 in SDLT.
To find out how much you could save under the new changes and how much SDLT you would have to pay on a purchase, you can use this handy Stamp Duty Calculator, or you can find the latest rates in the table below.
|Tax Band||Normal Rate||Additional Property|
|less than £500k||0%||3%|
|£500k to £925k||5%||8%|
|£925k to £1.5m||10%||13%|
Do I need to apply for the stamp duty holiday?
No, you don’t need to apply to receive the discounted SDLT rates. The discount will be automatically applied on all house purchases (under £500,000) and according to BBC, nearly 9 out of 10 buyers will pay no stamp duty! It is estimated that the average stamp duty bill will fall by £4,500.
If you are looking to take advantage of the governments stamp duty holiday, we could help. We offer a range of residential mortgage products to suit your circumstances, with personal in-house mortgage advisers, no arrangement or overpayment fees and mortgage repayments straight from your payroll*. Click the button below and arrange a call back with one of our friendly team to discuss your circumstances.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
*Payroll deduction available in 28 forces.